1. Field of the Invention
This invention relates to an apparatus and/or method for using a computer for determining forecasted inventory replacement orders for serving a plurality of forecasted and continuous demands.
2. Prior Art
Over the past decades, there has been a growing interest in the way companies control their resources including materials, warehouse, machinery, inventory, etc., in order for the companies to improve their service to clients, reduce their costs and make the most of their resources. Indeed, a number of computer controlled systems have been developed for modeling and supporting the control of these resources. These methods include Material Replacement Planning (MRP) (see FIGS. 1a, 1b); KAN-BAN and Stock Replacement techniques. Although these models are built for many strategic approaches, they may be considered incomplete and/or partial.
The decisions taken with regard to Material Replacement Planning (MRP) in a logistical system such as that described in this specification are simple in theory, but very complex in practice. They are simple in theory because if we accept the fact that the demands to be met by the system are precisely the forecasted ones, and that the time taken by the replacement orders is also the expected time, we need only set up a Gantt chart for each demand forecast, obtaining through the bill of materials for the item for which the demand is forecast, a whole succession of its components, and these (depending on the sequence laid down by the bill of materials itself) may be brought forward in time by their forecasted replacement values. The programmed and forecasted requirements thus obtained for each item, for all the assemblies of which it is a component, gives us the total requirements for this item, as well as the deadlines for launching and/or replacement of the same. These requirements can be grouped (brought forward) by batches or other factors.
In practice, however, this is not as simple as it appears, since the actual demand is not usually the forecasted one and the actual replacement times are not usually the forecasted ones. If at a certain moment we take into account the programming we have forecasted from one point and what has happened until this point was reached, we shall surely find that the quantity to be manufactured or replaced has arrived before it was due to arrive, or has still not arrived, and that besides, this quantity has been manufactured or replaced or is still being processed, and is greater or smaller than what was actually ordered.
It may be necessary, for example, to accelerate the termination of a delayed manufacturing process and/or add the necessary quantities to the batch manufactured to meet a greater demand than that forecasted. Thus, the production rates are distorted and the demands are not met correctly.
No one is in any doubt as to the negative consequences that poor service has on the image of the company in the eyes of the client, or the damaging effects that modifications, accelerations (and therefore delays), parallel manufacturing, etc., have on the use of productive resources, the lengthening of "maturing" periods and also on the generation of stocks. All this without taking into consideration the costly and complex control systems and the decisions necessary for "remedying" the previous situations.
On the other hand, buying and manufacturing each item of the system in relation to its own situation and the future forecasts programmed for it, means that any error in the demand forecasts will be reflected in the purchases or manufactures.
The KAN-BAN techniques, which form part of the "just in time" philosophy, indirectly revealed the defects of the previous approach, and proposed, among other things, that the demand itself should determine the replacement orders and not the forecasts, as in the MRP technique.
This is a principle with which we are in complete agreement, but in our opinion, it is incomplete, since it is only a tactical technique and forecasts are still necessary in order to plan and adapt the production load and capacity. On the other hand, as we understand it, in general, the KAN-BAN techniques are only applicable to certain specific cases and processes within the company. Thus it still remains necessary to coordinate these KAN-BAN processes with the other processes of the company.
The Stock Replacement Method, which is clearly advantageous with regard to simplicity and reaction to the actual demand received (within the environment of foreseen parameters), is still ideal for non-productive processes, but cannot be applied to controlling the replacement of components with erratic demands and in batches, since the method is only suitable for controlling stock replacement within an environment of constant demand.
The systems as described above are incomplete: MRP is based only on strategical forecasts and the KAN-BAN technique is founded only in tactical considerations; or partial: the Stock Replacement technique considers strategical and tactical approaches but it only applies to commercial and/or isolated item replacement.
Therefore, a model or system that takes decisions with regard to replacement orders is still necessary. Forecasts would still be used, but only as a strategical tool, in order to: plan (adapt) the forecasted "load" and "capacity" and also create the necessary strategical conditions for performing the tactical operations in the most advantageous manner--not only for the commercial and/or isolated items but for all the items in a logistical system. As a last resort, a tactical approach should lead to the replacement orders (in certain real-life situations), making it possible to carry this approach out under the most advantageous conditions, thanks to the forecasted strategical environment. All these are the characteristics of the forecasted model and for this it can be advantageously updated.